ORDER
Chittaranjan Satapathy, Member (T)
1. Heard both sides. The appellants clear the impugned glass (tinted and non-tinted) on payment of duty in about 9000 trucks in a year. In a few cases (50-60 trucks) the same get damaged and are returned and received back in the appellants’ factory. The dispute is whether the appellants allowed to take credit in respect of duty paid on such glass received back in damaged condition.
2. The appellants have cited the provisions of Rule 16 of the Central Excise (No. 2) Rules, 2001 which read as under :-
(1) Where any goods on which duty has been paid at the time of removal thereof are subsequently returned to the factory for being re-made, refined, re-conditioned or for any other reason, the assessee shall state the particulars of such return in his records and shall be entitled to have CENVAT credit of the duty paid as if such goods are received as inputs under the CENVAT Credit Rules, 2001 and utilise this credit according to the said rules.
[2. If the process to which the goods are subjected before returning does not amount to manufacture, the manufacturer shall pay an amount equal to the CENVAT credit taken under Sub-rule (1) and in any other case the manufacturer shall pay duty on goods returned under Sub-rule (1) at the rate applicable on the date of removal and on the value determined under Sub-section (2) of Section 3 or Section 4 or Section 4A of the Act, as the case may be.]
(3) If there is any difficulty in following the provisions of Sub-rule (1) and Sub-rule (2), the assessee may receive the goods for being re-made, refined, re-conditioned or for any other reason and may remove the goods subsequently subject to such conditions as may be specified by the Commissioner.
They have also cited the earlier decision of the Tribunal in the case of Triveni Sheet Glass Works Ltd. v. CCE in which it was held that receipt of damaged glass would be covered under erstwhile Rule 173L of the Central Excise Rules, 1944. It was also held therein that the process of re-melting of damaged and broken glass and making new sheet glass is covered by the expression ‘remaking’.
3. After considering the submissions from both sides, perusal of the case records and in view of the cited Tribunal’s decision in the case of Triveni Sheet Glass (supra) and the fact that the expression ‘re-made’ is also used under the said Rule 16, we hold that the appellants are entitled to duty credit on damaged glass received by them. As such, we set aside the impugned order and allow the appeal with consequential benefit to the appellants.
4. Our order as above was pronounced in the open court on the date of hearing on 23-12-2005.